China's factory activity shrinks in May

China’s factory activity in May 2025 shrank for the first time in eight months, a survey showed, indicating US tariffs are now starting to directly hurt the manufacturing superpower. The Caixin/S&P Global manufacturing PMI fell to 48.3 in May from 50.4 in April, missing analysts’ expectations and marking the first contraction since September last year. It was also the lowest reading in 32 months. The result is broadly in line with China’s official PMI that showed factory activity fell for a second month. A federal appeals court temporarily reinstated the most sweeping US tariffs, a day after a trade court ruled that President Donald Trump had exceeded his authority in imposing the duties and ordered an immediate block on them. According to the Caixin survey, new export orders shrank for the second straight month in May and at the fastest pace since July 2023, as per a report.

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